The benefits of an over-the-road TMS are significant. The average shipper faces an approximate 6.4 million possible combinations for simply sending 1000 shipments. Augment this capability over parcel shipping, and the results are staggering. Furthermore, significant challenges exist in managing over-the-road freight, including the need to manage multi-driver relationships, consider cloud-computing capabilities, leverage data analytics, and much more. Shippers need to understand the benefits of an over-the-road platform and how it could impact their operation.
Benefits of an Over-the-Road TMS on LTL Freight
Implementing an over-the-road TMS has the most advantages in managing LTL freight. Since LTL freight refers to freight that does not meet the threshold for full truckload but still requires more care than parcels. LTL is an area of a significant opportunity for shippers to optimize. Implementing an over-the-road TMS allows shippers to integrate the platform with their warehouse management system (WMS) and Enterprise-resource-planning platforms, tap into the value of additional LTL carriers, including regional and local carriers, and reduce overall costs.
The State of Transportation Management Systems, Current Trends, & Key Benefits of a TMS
Additional Benefits of TMS Implementation Revolve Around FT
The use of full truckload is among the cheapest for carriers in value and consumption. Full truckload takes advantage of volume discounts, and it involves fewer stops than a typical shipment. As a result, fuel surcharges, driver time, labor-management, and other factors decline. However, the diversification of today’s supply chains means shippers may have trouble accessing full truckload. As more e-commerce orders come in, shippers simply lack the resources to justify the use of full truckload. However, the use of an over-the-road TMS empower shippers with freight consolidation capabilities, transforming LTL freight into full truckload shipments, which simplifies freight spend, and it is essential in understanding and navigating the complexities of dimensional pricing (DIM), which focuses on rate and weight based on the volume of the package, not just its actual weight.
Over-the-Road Capabilities Also Tap into the Value of Volume LTL
Volume LTL is situated between the weight classes traditionally associated with parcel and LTL. Consider this; parcel packages are limited to 150 pounds or less, but LTL freight classifications can go as high as 7000 pounds, if not 10,000. The wide variety between the minimum and maximum weight within LTL means shippers need another way to manage freight and give it its own mode. This increase in mode variety enables scalability, notes Supply Chain 24/7.
Parcel Benefits Are Included as Well
The use of parcel is the most impactful in e-commerce freight management. As more companies come online, competition for the average shipper increases, and it makes a hard-sell for companies to continue operating with manual processes. In addition, inventory carrying costs skyrocket, but just-in-time fulfillment models can leverage optimized inbound and outbound freight management to lower inventory levels.
Final Mile and White Glove Service
Final mile and white glove services are two of the newest opportunities for shippers to connect with consumers. Now, the final mile, also known as the last mile, has been a topic of concern for shippers for decades. It is the final stage of a shipment’s journey to the destination, such as loading a shipment onto a local delivery van for distribution within a residential area. However, the complexity of basic products is expanding and simply delivering products is not enough to secure a competitive advantage in today’s world. For some products, shippers are expected to provide installation, or at least manage the installation, which is where final mile in white glove service gets complicated, taking advantage of internal and external resources, such as third-party contractors, to install consumer products.
Tap Into the Value of the Benefits of an Over-the-Road TMS before Your Competitors Do
The benefits of an over-the-road TMS are too great to ignore. According to recent research, the value of the TMS market is expected to soar past $4.9 billion by 2025, and 91% of shippers operating more than 20 trucks are actively using a TMS today. Stop trying to manage your logistics network with outdated processes; evolve your operation with a dedicated over-the-road TMS today.
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